UNB, Dhaka :Energy and Mineral Resources Division has initiated a move to formulate a policy for the import of petroleumwhich may bring an end to Bangladesh Petroleum Corporation’s (BPC’s) ‘monopoly’ in selecting foreign companies.Official sources said, the Energy Division has proposed seven criteria in its draft policy to determine the companies to import petroleum under the G-to-G deals. It said that a state-owned company must be 100 percent state-owned one to become eligible for supply.The company must have the annual export volume of minimum 2 million mt of petroleum having a turnover $5 billion and 5 years oil export experience. The company should not face any embargo by international agencies like the UN, Opec or WTO.The crude oil supplier must have production sharing contract (PSC) with its own country or any other country. However, nothing was said about tendering method to select a private supplier.Energy Division’s deputy secretary Farzana Momtaz said the proposed petroleum import policy is yet to be finalised. “It’s still under process,” she told UNB. At present, there is no specific policy or guideline for the import of petroleum from global markets although the country has to import about 5 million metric tonnes of both crude and refined petroleum fuel. Of the amount, crude oil accounts for about 1.5 million while the rest is refined oil.For the last several years, the government has been importing refined oil from state-owned companies of different countries under separate state-to-state or G-to-G (government-to-government) deals.But, there is no guideline that how much bulk fuel should be imported from which companies or countries. The practice is that Bangladesh Petroleum Corporation (BPC), the state-owned petroleum importing agency, just negotiates with the companies and settles the quantity of import on bilateral basis.In this case, the BPC applies its arbitrary and discretionary power to determine the quantity of import and also the supplying source.Such matter came up for discussions in recent meetings of Cabinet Economic Affairs Committee and Cabinet Purchase Committee which felt the necessity of having a certain guideline and policy for petroleum import while approving such deals.At one stage of such discussions, some senior Cabinet members were learned to have advised the Energy and Mineral Resources Division of the Power, Energy and Mineral Resources Ministry to initiate a move to frame a policy, sources close to the meeting said.The meeting was told that such practice in the petroleum import should not continue for long, and they suggested that there should be a specific guideline for the BPC to determine the import quantity and the companies.”We’ve initiated the move to formulate the policy in compliance with such Cabinet body’s directives,” said a senior official at the Energy and Mineral Resources Division.Some energy experts also feel the billion-dollar business in the petroleum sector could be utilised for promotion of trade, investment and diplomatic purpose as well. But the first of all, the government has to look into the quality, price and reliability of timely supply.Head of the Department of Petroleum and Mineral Resources Engineering of Buet (Bangladesh University of Engineering and Technology) Dr. M Tamim said it is still a matter of debate whether the import should be made under G-to-G deal or through open tender.He said if there is open tender, the cost of petroleum may not be changed, but the cost of handling (freight charge) could be lower as open tender normally ensures a competitive price. “But, when things are settled through negotiations, it leaves a scope for manipulations,” he added.Dr Tamim, who was in-charge of the Power, Energy and Mineral Resources Ministry, as special assistant to the Chief Adviser of caretaker government during 2007-08, said quality, price and guarantee of timely supply should get the highest priority to determine a supplier. A single country or company should not get the entire job, he said.Former BPC chairman Muktadir Ali, however, said the petroleum importing agency normally prefers Go-to-G companies as supplier, as this could give a flexibility to make schedules to receive fuel supply throughout the year.”Through negotiations, the BPC sets a schedule which company will supply the product and when,” he said.Energy Division official documents reveal that the BPC has been importing petroleum fuel through international tenders since its creation in 1976.But in 2003, BPC started the import of petroleum fuel under G-to-G or state-to-state deal from Kuwait’s state-owned petroleum company. BPC director Mosleh Uddin said they are planning to go for the import of petroleum from international market through open tender from the next year once the policy is approved by the government.
